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- MPFA welcomes the 2023-24 Budget
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MPFA welcomes the 2023-24 Budget
The Mandatory Provident Fund Schemes Authority (MPFA) welcomes the proposal in the 2023-24 Budget Speech delivered by the Financial Secretary Mr Paul Chan today (22 February) to increase the tax deduction for MPF voluntary contributions made by employers for their employees aged 65 or above, from the current 100% to 200% in respect of such expenditure. The MPFA will render full support to the Government in formulating the implementation details and executing the proposed measure.
MPFA Chairman Mrs Ayesha Macpherson Lau said, “I am very grateful that the Financial Secretary proposed to enhance the existing tax incentive so as to encourage employers to make voluntary contributions for employees aged 65 or above. This proposed measure could strengthen the retirement reserves for mature employees, enabling the MPF System to better perform its retirement protection function.”
Mrs Lau added that the MPFA has been encouraging employers to enhance the retirement reserves of their employees by making voluntary contributions for them on top of mandatory contributions. Currently, an employer can claim tax deduction for the mandatory and voluntary contributions made for an employee, to the extent that it does not exceed 15% of the employee’s total emoluments. If the proposed measure is implemented, it will be a win-win situation as employees continuing to work beyond age 65 could continue to increase their retirement savings, while employers will enjoy enhanced tax deduction.
In addition, it was mentioned in the Budget Speech that the Hong Kong Monetary Authority (HKMA) and the MPFA are tasked to conduct a study on MPF funds that offer stable returns at low fees. To start off, the Government plans to earmark a certain proportion of the future issuances of Government green bonds and infrastructure bonds for priority investment by MPF funds, thereby providing MPF scheme members an additional investment option. The MPFA welcomes the initiative which is expected to further diversify MPF investment opportunities. The MPFA will collaborate with the HKMA in conducting the related study.
－Ends－
22 February 2023
MPFA Chairman Mrs Ayesha Macpherson Lau said, “I am very grateful that the Financial Secretary proposed to enhance the existing tax incentive so as to encourage employers to make voluntary contributions for employees aged 65 or above. This proposed measure could strengthen the retirement reserves for mature employees, enabling the MPF System to better perform its retirement protection function.”
Mrs Lau added that the MPFA has been encouraging employers to enhance the retirement reserves of their employees by making voluntary contributions for them on top of mandatory contributions. Currently, an employer can claim tax deduction for the mandatory and voluntary contributions made for an employee, to the extent that it does not exceed 15% of the employee’s total emoluments. If the proposed measure is implemented, it will be a win-win situation as employees continuing to work beyond age 65 could continue to increase their retirement savings, while employers will enjoy enhanced tax deduction.
In addition, it was mentioned in the Budget Speech that the Hong Kong Monetary Authority (HKMA) and the MPFA are tasked to conduct a study on MPF funds that offer stable returns at low fees. To start off, the Government plans to earmark a certain proportion of the future issuances of Government green bonds and infrastructure bonds for priority investment by MPF funds, thereby providing MPF scheme members an additional investment option. The MPFA welcomes the initiative which is expected to further diversify MPF investment opportunities. The MPFA will collaborate with the HKMA in conducting the related study.
－Ends－
22 February 2023
